El Dorado–Monserrat (EDM) PEA: $1.50B NPV, 65% IRR
Fredonia Mining Inc.'s El Dorado–Monserrat (EDM) in Argentina, Santa Cruz Province, Patagonia has a Preliminary Economic Assessment (PEA) outlining an after-tax NPV of $1.50B, an after-tax IRR of 65%, and initial capital of $346M. The mine plan runs 17 years at about 140 koz AuEq per year.
Fredonia Mining Inc.'s El Dorado–Monserrat (EDM) has reported Preliminary Economic Assessment (PEA) results for the gold (with silver by-product) project in Argentina, Santa Cruz Province, Patagonia. The study headlines an after-tax net present value of $1.50B at a 10% discount rate. It reflects Fredonia Mining Inc.'s (FRED.V) latest disclosed economics for the asset.
Economics. The after-tax NPV is $1.50B using a 10% discount rate. After-tax IRR is 65%. Initial capital expenditure is estimated at $346M. All-in sustaining costs are pegged at 1720 USD/oz Au. Economics are based on US$3,800/oz Au and US$45/oz Ag for PEA base case (mine planning / process feed AuEq); US$4,000/oz Au and US$70/oz Ag for Mineral Resource reporting AuEq. NPV10 base-case. RIGI scenario potential NPV10 uplift +US$314M..
Production and mine plan. The project envisions an open-pit (main veins and la herradura open pits) operation. Life of mine is 17 years. Average annual production is approximately 140 koz AuEq. Average head grade is 0.73 g/t AuEq (plant feed 124Mt); 0.725 g/t AuEq plant feed. Metallurgical recovery averages 85%. The open-pit strip ratio is 1.7×.
These figures are extracted from Fredonia Mining Inc.'s technical disclosures and reflect the most recent PEA on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Measured | 66.292 Mt | 0.50 g/t Au, 13.15 g/t Ag, 0.72 g/t AuEq | — |
| Indicated | 60.162 Mt | 0.44 g/t Au, 12.11 g/t Ag, 0.64 g/t AuEq | — |
| Measured & Indicated | 126.454 Mt | 0.47 g/t Au, 12.66 g/t Ag, 0.68 g/t AuEq | 2,758.6 koz AuEq; 51.460 Moz Ag; 1,932.7 koz Au |
| Inferred | 73.891 Mt | 0.31 g/t Au, 8.98 g/t Ag, 0.46 g/t AuEq | 1,087.8 koz AuEq; 21.345 Moz Ag; 739.6 koz Au |
Our Analysis
- IRR after-tax
- 65%
higher than 87% of 345 projects we track
- NPV after-tax
- $1.50B
higher than 79% of 442 projects we track
- Initial capex
- $346M
23% of NPV
costlier than 57% of 444 projects we track
- Mine life
- 17yrs
- Discount rate
- 10%
- Study price assumption
- US$3,800/oz Au and US$45/oz Ag for PEA base case (mine planning / process feed AuEq); US$4,000/oz Au and US$70/oz Ag for Mineral Resource reporting AuEq. NPV10 base-case. RIGI scenario potential NPV10 uplift +US$314M.
- Spot gold today
- $4,444.40/oz
A US$36M nano-cap proposing a US$346M build is not a financing story; it is a dilution story. The initial capex alone is roughly 9.7x the company's entire market cap, and this is its only tracked project. No conventional lender writes a project-finance cheque of that size against a single-asset junior, so the realistic path is equity, streams, or a strategic partner. Each of those routes carries a heavy cost: existing holders would face severe dilution, a royalty or stream would carve into the 65% after-tax IRR, and a partner would likely demand a controlling stake given the scale mismatch. The NPV-to-market-cap gap of about 42.2x is the market's way of saying the asset is real but the path to building it is not yet credible.
The economics are the supporting act, and they are genuinely strong. The 65% after-tax IRR ranks higher than 87% of the 345 tracked projects, and the US$1.50B NPV clears the practical financing hurdle of roughly 20% for a higher-risk junior by a wide margin. The 23% of NPV allocated to initial capex is capital-light versus the 43% average across the 444 tracked projects, which helps, but it does not change the absolute funding gap. The study's gold price assumption of US$3,800/oz sits below today's spot of US$4,444.40/oz, so there is margin in the price deck, though the PEA's scoping-level capital estimate carries a wide band and the 17-year mine life in Santa Cruz Province, Argentina adds jurisdictional and execution risk that a feasibility study would sharpen.
The single question that decides whether this works is not whether the orebody is good, it is who writes the first cheque and on what terms. If the company secures a partner or offtake that funds the build without gutting equity, the returns justify the risk. If it must fund through dilution at a US$36M valuation, the math for current holders becomes punishing regardless of the headline NPV. Watch for the financing announcement, not the next resource update.
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.